Unemployment in the country could increase

			
				Unemployment in the country could increase		  	
		
Publicado 2016/05/21 13:00:00

	    Clarissa Castillo
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					clarissa.castillo@epasa.com
				
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The alleged linkage, indicated by the United States, of businessmen Waked with money laundering, generates is jeopardizing thousands of jobs nationwide, which could increase the informal economy in the country, specialists say.

The alleged linkage, indicated by the United States, of businessmen Waked with money laundering, generates is jeopardizing thousands of jobs nationwide, which could increase the informal economy in the country, specialists say.

The Waked case appeared in a moment in which Panama was already under international scrutiny by the misnamed Panama Papers publications.

According to economists and business people, recent scandals may cause that unemployment rates to increase and could even affect the economic growth that is expected.

Economist Juan Jované explains that unemployment causes a multiplying effect.

"When someone loses their job, they also stop consuming," he said.

If credit should be stopped and the volume of investment in the country should be reduced, we will have less economic activity and jobs.

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Morabia Guerrero, President of the Panamanian Association of Business Executives (Apede), is of the view that with this scandal unemployment rates can increase.

SHe noted that the closing of businesses could affect thousands of Panamanian families, which would generate greater uncertainty.

The Waked group has over 68 companies that employs more than 6,000 workers who are now in uncertainty, not knowing what will happen to their jobs.

Meanwhile, the Ministry of Labor and Labor Development (Mitradel) ensures that more than 75% of group Waked jobs will not be affected, since they consider that there is a high probability that businessman Abdul Waked´s companies can get new licenses to operate normally.

For its part, the Government confirmed that it will secure the jobs of all workers regardless of the outcome.

However, these statements have not produced a calmed reaction, since workers have kept vigil and marched to the attention of the current authorities.

Retailers have announced that they have a drop in sales of between 40% and 50%, which causes even more fear among workers.

According to the President of the National Council of Private Enterprise (Conep), Julio De La Lastra, negotiation between U.S. and Panamanian authorities could avoid losing some jobs.

"That thousands of people are overnight out of work is not easy and that is why it is important to make the necessary negotiations at a diplomatic level", said De La Lastra.

Some companies of Group Waked are group Wisa S.A., La Riviera, Panama Life (free zone), Hometek, Felix B. Maduro, Soho Mall, Millennium Plaza, Importadora Maduro, Balboa Bank and newspapers El Siglo and La Estrella.

They also include duty free, and real estate, trade and catering which are object of investigation by the United States.

Impact

The impact on the companies started to be felt upon the second day through the US license suspension, after the decision of the US Treasury was known.

Clients of these businesses in question can pay only with cash, check, gift cards or card club, however, neither credit nor debit card are being taken because several banks decided to terminate the contract of service affiliation.

For the President of the Chamber of Commerce, Industries and Agriculture of Panama, Jorge García Icaza, the most important thing is to know how to advance in the process and that there could be greater confidence by the public and employees in the actions of the Government.

Meanwhile, as a result of the scandals, France is pressing and pointing repeatedly at Panama as being a tax haven, thus attacking the image of the country, which could scare off foreign investment.